Logistics Hub

Port company Kingston Wharves Limited will continue investing in heavy capital projects despite business uncertainty and a global logistics sector that is still beset by multiple challenges. “These initiatives are allowing KW to build a secure future. KW is strengthening the business, expanding our operations, and diversifying the cargo type we handle,” said CEO Mark Williams on Thursday. “The horizon ahead might be uncertain, but we surge ahead with confidence,” he told shareholders at the company’s annual general meeting. The company last year announced a US$60 million drive to raise its cargo capacity. It acquired a new crane to load and unload cargo and completed the preliminary stages of the development of Berth No. 7. Kingston Wharves also plans to build a warehouse complex at Ashenheim Road in Kingston in the proximity of its wharf to allow third-party companies to operate “nearshore” business. “As we roll out our capital investment initiatives, we will maximise the use of our special economic zone status, our digital transformation [channels] to offer value-added services to manufacturers and distributors,” Williams added. “Preliminary works have started, the steel paid for, slots are identified and confirmed, and you will see work on the ground in a few months.” Chairman Jeffrey Hall said that the project would be financed from cash and loans. The port company’s cash holdings as of March was $9.5 billion, which gives the company options to finance the development without much borrowing. Its debt-to-equity ratio remained at 5.8 per cent compared to 5.1 per cent a year earlier. Its borrowings in the period rose from $1.22 billion to $1.35 billion. Usually, companies try to avoid having a debt-to-equity ratio above 50 per cent. “As far as interest rates, inflation, and geopolitical challenges, they do receive attention from the board. We have looked at our financing costs and their tenure, taking into account the environment. We also looking at managing costs notwithstanding inflation but pass on a fair share of costs to customers while ensuring business continuity. As far as the geopolitical, we cannot influence those things … . The location of commodities might change, but we will continue to have a business,” he said. In its March quarter financials, Kingston Wharves listed high fuel costs and the disruption of shipping activities from certain regions of the world as compounding the economic challenges but said it would “navigate these conditions with increased focus on our competitiveness, our customer service and our strategic relationships.” Profit rose in the quarter from $560 million to $679 million. Last year, Kingston Wharves grew revenue by 21 per cent to $8.7 billion and net profit by 43 per cent to $3.2 billion.   Source: https://jamaica-gleaner.com/article/business/20220619/kingston-wharves-surging-ahead-investments

Businessmen looks to exploit opportunities at Caymanas Special Economic Zone WHILE Jamaica continues to transform itself into a strategic destination point for logistics, delegates from the 2022 World Free Zones Organization Annual International Conference and Exhibition (AICE) gave Jamaica praise for the organisation of the event and economic opportunities from the expansion of its special economic zones (SEZs). The delegates gave their comments last Thursday as part of a tour of the proposed 650-acre Caymanas SEZ and associated logistic points from the Kingston Freeport Terminal to Port Royal. The conference was held from June 13 to 17 at the Montego Bay Conference Centre. “I visit this wonderful country, Jamaica. I love it,” said minister of economic development of state in Qintana Roo, Mexico, Rosa Elena Lozano Vazquez, on her impression of the country as she enjoyed a chicken patty. Free zones are usually defined areas where goods can be stored and received with a reduction in associated fees by the local authorities. SEZs approved by the Jamaica Special Economic Zone Authority (JSEZA) benefit from asset tax, income tax and customs duty relief. “It’s been very interesting. All the speakers, organisers, personalities and meeting with businesses. Jamaica is a strategic place for logistics and unites Mexico with other Caribbean islands. The economic free zone is very important for the people and economies of countries. Incentives are necessary for the attraction of investors,” she added on the relevance of free zones. Mexico is an industrial North American country which manufactures a variety of goods and benefits from the United States-Mexico-Canada Agreement. Several tourism and industrial businesses in Jamaica are owned by Mexican firms. The proposed Caymanas SEZ would give investors who lease the facilities the ability to derive significant economic benefits including no taxes on profits nor dividends. This would be done under a 50-year lease agreement where the firms would be able to bring in necessary equipment without any fees once it is not sold back in Jamaica. The applications for the development of the SEZ is being drafted for National Environment and Planning Agency (NEPA) approval, while procurement has started for the detailed design to begin the construction phase. Delegates and attendees at the event were able to see from an elevated view, the surrounding environment including the Jamaica Pegasus hotel in New Kingston and other major focal points such as the port area. Minister of Industry, Investment and Commerce Senator Aubyn Hill touted the presence of the Mandela Highway, educated workforce in St Catherine and rule of law with the Privy Council being Jamaica’s final appellate court. Some notable attendees included founder, president and chief executive officer (CEO) of Cornerstone United Jamaica Holdings Limited Paul Simpson and Myers, Fletcher and Gordon associate Jezeel Martin. The delegates went to view four different prospective sites in Trelawny on Friday. The wetlands surrounding the Caymanas SEZ will be maintained and left undisturbed according to Hill. Numerous companies have setup manufacturing outfits in the last decade with companies such as Sygnus Real Estate Finance Limited planning to invest US$6-10 million in the construction of a 55-acre industrial park in the Lakes Pen area. CEO of the Malaysian Port Klang Free Zone Loh Chee Chan welcomed the insights and experience he gained from the conference while being in Jamaica. “We started our free zone 17 years ago and we’re fully developed with our business in full swing. Now, we are looking at expansion to find another piece of land or location where we can expand our business. The only challenge we see is the distance from Malaysia,” he added as it took two days to arrive to Jamaica. However, he shared that the free zone experience has been rewarding especially as the Port Klang location is fully utilised by more than 170 firms. He also believed that Jamaica was a good prospect for various investors. “We developed our free zone over 1,000 acres of land. The tenants who lease the land from us will develop for the purpose of warehousing for their own use. We developed a standard warehouse which comprises of 500 units for shorter terms. People lease the warehouse to store their goods on a short-term basis. We also have office blocks where we use it for e-commerce and IT purposes,” he explained. While the Port Authority of Jamaica (PAJ) looks to invest US$40-60 million in infrastructure for the Caymanas SEZ, other companies such as Kingston Wharves Limited are matching a similar spend to ramp up its operations to handle the growing demand. It’s investing US$60 million in the redevelopment of Berth 7 and construction of the Integrated Modular Logistics Complex at Ashenheim Road. The company listed this in its 2021 annual report as part of its plan to attract global distributors and manufacturers who can also benefit from its SEZ designation and an efficient location to handle business. The PAJ owns five free zones with the last major launch being the 203,000 square feet Portmore Infomatics Park, which is managed by the Kingston Free Zone Company Limited. It has developed the Kingston Logistics Park which has more than 200,000 sq ft of space. Three clients are already on board with an additional 50,000 space available. Operations and Customer Relations Manager Glenice Leachman described the facility as the first in the hemisphere for near port logistics. “We’ve been here since last week. We have been very busy exchanging experiences with SEZ delegates who are here. For example, how do we develop our SEZ’s in Kenya, how do they develop their SEZ’s in their countries and what kind of investors they have been able to attract. Through sharing of experiences, we’re helping to broaden our spectrum of knowledge in how we can improve programmes back to our countries,” said CEO of the Kenya Special Economic Zones Authority Dr Meshack Kimeu Sammy on his experience in Jamaica so far. Apart from highlighting the creation of jobs in the country, Dr Sammy noted how universities have realigned themselves to meet the relevant skills and

SEVERAL BUSINESS operators who attended this week’s eighth Annual International Conference and Exhibition (AICE) 2022 at the Montego Bay Convention Centre in Rose Hall, St James, are praising it for the networking opportunities it has opened as Jamaica’s first major conference following the COVID-19 pandemic. AICE 2022, held from June 13 to 17, was hosted by the World Free Zones Organisation (World FZO), in association with the Jamaica Special Economic Zone Authority, under the theme: ‘Zones, your partner for resilience, sustainability, and prosperity’. It was also being held in conjunction with the first annual Global Alliance of Special Economic Zones Conference. The first three days of the event saw the approximately 1,055 registered delegates visiting booths strategically erected at the convention centre for business networking and exhibition of products and services, with the last two days being reserved for business-to-business meetings and tours of Jamaica’s special economic zones and other investment opportunities. Simoy Brown, application processing officer for Jamaica’s Cannabis Licensing Authority, said that her organisation’s information display got to benefit greatly from the conference, with numerous potential international investors seeking them out to establish a network. “We thought it necessary to be a part of the conference, as we see that there is a lot of interest in the Cannabis Authority here in Jamaica. We see where there is a lot of interest, especially with investors wanting to be a part of this great industry, to help economic development for Jamaica,” Brown told The Gleaner. “We see where we have gotten feedback, as people from as far as Kenya, Zimbabwe, Dubai, and parts of Ecuador and Colombia have visited our booth and have expressed an interest in the authority. We will meet with those persons as a part of knowledge-sharing, to see the best practices that we can take from some of these industries,” Brown explained. Garth Hinchcliffe, deputy chief executive officer for the Kingston-based Manpower and Maintenance Services Limited, was likewise grateful for the opportunities which have arisen for his business, thanks to the conference, especially on the heels of the pandemic which restricted such networking possibilities over the past two years. “The feedback has been fabulous, as we have gotten about 45 different inquiries and we have other free zone entrants who have come to us to ask what we are doing. We are talking to people from Kenya who have their free zones, Curaçao and Costa Rica to get some idea of how to do it right,” said Hinchcliffe. Local delegates were not the only ones to praise the AICE 2022, as Srikanth Badiga, a delegate from India who serves on the World FZO’s board of directors, also showered praises on the event. “It is one of the best conferences I have been to. I have a lot of things to take back home and share with other persons, and I see huge prospects from working with a country like Jamaica,” said Bagida. “Jamaica is a wonderful place with wonderful people. I am looking at how I can establish trade here and how I can take this trade internationally to my country, and I am sure I want to come back with more business opportunities.” Dr Mohammed Al Zarooni, chairman of the World FZO, expressed confidence that the conference will herald the start of close ties between his organisation and Jamaica. “This is the beginning of working with the Government of Jamaica, and I am sure that what is coming is more than what we did this time. I wish the Government of Jamaica all the best, and I also would like to show appreciation from the bottom of my heart for all the efforts and support that we received from the Government,” said Al Zarooni.

Investors from across the globe are being wooed to plough millions of dollars into the 650-acre Caymanas special economic zone (SEZ) that has been described by Gary Lawrence, senior vice-president of engineering at the Port Authority of Jamaica (PAJ), as the largest single project ever to be embarked on in Jamaica. Following years of gestation, the project is being brought to life by the PAJ, whose principals told prospective investors Thursday that the Government was taking steps to put in utilities and other critical infrastructure in preparation for persons who are already knocking on the door. The project is poised to be among the top-tier logistics free zones across the region. Gordon Shirley, chairman of the PAJ, told The Gleaner Thursday while touring Caymanas that his agency has been tasked with getting the SEZ started. The authority will spend between $40 million and $60 million to install infrastructure at the property. He said that multiple subdevelopers could take on some components of the project. Shirley said that the authority was in discussions with a number of investors, including some from the United States. “We are open for business, but we intend to proceed along the lines that the Government has outlined, so regardless of how quickly they come along, our mandate is to get this in a position to be operational as quickly as possible,” he added. Aubyn Hill, minister of industry, investment and commerce, told prospective investors that the Government will be providing 50 years of tax-free benefits in a long-term lease arrangement. “If you bring in stuff as you would have to (in order) to build it out, no taxes on it. You take it out, no taxes on it, but you can’t sell into Jamaica when you are in the special economic zone,” he said. Hill said that the build-out of the SEZ would create jobs for Jamaicans. The industry and investment minister, however, sounded a warning to those who might want to use dirty money to invest in the SEZ. “If it is not clean, we don’t even have to find it. Other people will find it and tell us you are not clean,” he said. The PAJ said it has already engaged other government departments that are part of the approval process such as the National Environment and Planning Agency in relation to the area to be developed. The Port Authority of Jamaica owns five free zones that now employ close to 20,000 people. The latest is the Kingston Logistics Park, which has more than 200 square feet of new facilities.

Potential investors/developers who decide to operate within the proposed Caymanas Special Economic Zone (SEZ) in St. Catherine will enjoy tax-free benefits for an extended period. This was disclosed by Minister of Industry, Investment and Commerce, Senator the Hon. Aubyn Hill, who said the Government is looking to attract interest in the development of the property as it seeks to get the Caymanas SEZ project started. “They will get 50 years tax-free benefit – no taxes, no income tax for 50 years. In contract, by lease, you’ll get this wonderful piece of land,” he said. Prime Minister, the Most Hon. Andrew Holness, has mandated the Port Authority of Jamaica (PAJ) to get the project started. SEZs are areas created within a country to facilitate rapid economic growth by leveraging tax incentives as a way of attracting foreign investments and technological advancement. Senator Hill was speaking yesterday (June 16) to global investor delegates/participants from the World Free Zones Organization’s Annual International Conference and Exhibition (AICE), 2022, being held in Montego Bay from June 13 to 17. As part of the conference, they were participating in the Port Authority of Jamaica (PAJ) Investor Tour of SEZs, ports and logistics facilities, which began at the proposed site of the Caymanas SEZ, where more than 650 acres, to comprise industrial and commercial spaces, will be developed for logistics purposes. Senator Hill further noted that 50 years without any taxes on dividends will be beneficial to the developer/investor who can arrange to have as many business operators rent their property, as they will have a long-term lease that will be renewable. “You will get that profit; no taxes on it and then… if you bring in [items] as you will have to build it out, no taxes on it; you take it out, no taxes on it, but you can’t cross the border, you can’t sell into Jamaica when you’re in the SEZ,” he advised. Senator Hill further informed that the Government will be investing between $40 million and $60 million in the property to put in place the necessary utilities, including water. It will also have broadband access. He informed that the investors/developers who wish to develop the property will have a negotiated period of time within which it must be developed. Senator Hill pointed out that the Central Bank will allow investors to take in “clean money”, because if it’s not clean, “we don’t even have to find it, other people will find it and tell us you’re not clean… so don’t bother with it – clean money in clean money out, no currency restrictions”. He also reminded investors that Jamaica has an ample workforce available, noting that mainly young, trainable persons comprise the 1.5 million people living in the Kingston and Portmore, St. Catherine, areas. From an elevated platform on the property, investors were given a clear vantage point to see the site’s proximity to key commercial and residential developments. The tour also included the Kingston Logistics Park, Kingston Freeport Terminal Ltd., and the Port Royal Cruise Port. Held annually, the conference is a marquee event for free zones and associated entities. Being hosted by the Jamaica Special Economic Zone Authority (JSEZA) this year’s conference features global business leaders, multilateral organisations, and policymakers from some 140 countries, who are driven towards the development and expansion of SEZs. The PAJ, which has been charged with leading the promotion of Jamaica’s Special Economic Zones and Logistics offerings, is a main sponsor for the conference.   Source: https://jis.gov.jm/long-term-tax-free-benefits-for-investors-in-caymanas-sez/

ST JAMES, Jamaica — Approximately 60 potential investors from around the world are currently on a two-day tour in Kingston and St Catherine as they wrap up participation in the World Free Zone Organization’s 8th Annual International Conference & Exhibition. After meetings at the Montego Bay Convention Centre from June 13 to 15, Thursday and Friday— the last two days of the event — are being used for investment tours and other related activities. “We will be heading into the Caymanas area, the port lands (in Kingston) to have investors or potential investors review those projects to identify if they have any interest in them,” Acting Chief Executive Officer (CEO) of the Jamaica Special Economic Zone Authority (JSEZA), Gary Scott disclosed in an interview with OBSERVER ONLINE, following the AICE closing ceremony on Wednesday. “There are other tours that we are organising that will allow for some of them to be able to see and look at other investment projects that we would like to pitch to them and identify their interests,” he added. There is a big push to stir interest in the Caymanas Special Economic Zone in St Catherine. At the conference on Tuesday, Prime Minister Andrew Holness announced that work would begin on the long-awaited project as part of Jamaica’s 60th anniversary celebrations. It spans 650 acres of land. The Port Authority of Jamaica has been charged with getting the work done. “It is a large scale distribution and logistics type centre fulfilment park. Feasibility studies have been done and the Port Authority… and a few other Government agencies are seeking to find an opportunity to get investors for that,” explained Scott. “It is an investment in the development of the industrial park or the logistics centre in the first instance. It’s the build-out of the entire real estate development infrastructure, the warehousing etc, and then identifying various companies who will operate from these zones,” he added. Among the benefits of the project which would make it attractive to investors, he said, is its close proximity to the port of Kingston. “The objective is to be able to have goods — that are normally transhipped — be able to come into these zones and value can be added. So, you have value-added services of packaging and assembling of various activities happening in a Caymanas Special Economic Zone, as one example, and then get redistributed from Jamaica into different countries around us in the Americas,” he added. In addition to being bullish about the Caymanas project, Scott is optimistic about Jamaica’s investment prospects overall. “We had a successful conference, in general. A lot of information has been shared between the different panel discussions. It was good to have some of our own Jamaicans participate and get a good sense of what the world does, where free zones are concerned, and the depth and growth opportunities that free trade zones or special economic zones, in our instance, can do for the country,” he said.   Source: https://www.jamaicaobserver.com/latest-news/60-potential-investors-on-tour-of-kingston-st-catherine/